AMENDMENT No. 1 Dated as of October 10, 2008 to AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT Dated as of September 26, 2008
EXECUTION
COPY
Exhibit
10.42
AMENDMENT
No. 1
Dated
as of October 10, 2008
to
AMENDED
AND RESTATED RECEIVABLES PURCHASE AGREEMENT
Dated
as of September 26, 2008
This
AMENDMENT NO. 1 (this “Amendment”) dated as
of October 10, 2008 is entered into among PILGRIM’S PRIDE FUNDING CORPORATION
(“Seller”),
PILGRIM’S PRIDE CORPORATION (“Pilgrim’s Pride”) as
initial Servicer, THE VARIOUS PURCHASERS AND PURCHASER AGENTS FROM TIME TO TIME
PARTY THERETO and BMO CAPITAL MARKETS CORP., as administrator (in such capacity,
together with its successors and assigns, the “Administrator”).
RECITALS
WHEREAS,
the parties hereto have entered into a certain Amended and Restated Receivables
Purchase Agreement dated as of September 26, 2008 (the “Agreement”);
WHEREAS,
in order to make the most efficient use of the financing facility contemplated
by the Agreement and the other Transaction Documents, the Seller has requested
the Purchaser and the Administrator to agree to certain amendments and/or
modifications to such facility as described herein for various
purposes;
WHEREAS,
the Purchaser and the Administrator are willing to agree to such amendments
solely on the terms and subject to the conditions set forth herein;
NOW,
THEREFORE, in consideration of the promises and the mutual agreements contained
herein and in the Agreement, the parties hereto agree as follows:
SECTION
1. Definitions. All
capitalized terms used, but not otherwise defined, herein shall have
the respective meanings for such terms set forth in Exhibit I to the
Agreement.
SECTION
2. Amendments to the
Agreement. The Agreement is hereby amended as
follows:
2.1. The
definition of “Loss Percentage” set forth in Exhibit I to the
Agreement is hereby amended and restated in its entirety as
follows:
“Loss
Percentage” means, on any date, (a) solely during the Waiver Period, the
greatest of (i) 4 times the sum of (x) the highest average of the Default Ratios
for any three consecutive calendar months during the twelve most recent calendar
months, plus (y) the greater of (1) the highest average of the Dilution Ratios
for any three consecutive calendar months during the twelve most recent calendar
months and (2) 1.75%, (ii) 3.5 times the quotient (expressed as a percentage) of
(x) the aggregate Outstanding Balance of the Eligible Receivables then included
in the Net Receivable Pool Balance of the non-Investment Grade Obligor with the
greatest amount of Receivables included in the Net Receivables Pool Balance
divided by (y)
Net Receivables Pool Balance on such date, and (iii) 12%; and
(b) at all
times following the expiration of the Waiver Period, the greatest of (i) 5 times
the sum of (x) the highest average of the Default Ratios for any three
consecutive calendar months during the twelve most recent calendar months, plus
(y) the greater of (1) the highest average of the Dilution Ratios for any three
consecutive calendar months during the twelve most recent calendar months and
(2) 2.25%, (ii) 4 times the quotient (expressed as a percentage) of (x) the
aggregate Outstanding Balance of the Eligible Receivables then included in the
Net Receivable Pool Balance of the non-Investment Grade Obligor with the
greatest amount of Receivables included in the Net Receivables Pool Balance
divided by (y)
Net Receivables Pool Balance on such date, and (iii) 18%.
2.2.
The definition of “Normal Concentration Percentage” set forth in Exhibit I to the
Agreement is hereby amended and restated in its entirety as
follows:
“Normal Concentration
Percentage” means, at any time, (1) solely during the Waiver Period (a)
for any Obligor that is not a Special Obligor or Wal-Mart, 3%; (b) for any
Obligor that is a Special Obligor, (i) if such Special Obligor is rated A+ or
better by S&P and A1 or better by Xxxxx’x, 12% or (ii) if such Special
Obligor is not so rated but is rated at least BBB- by S&P and Baa3 by
Xxxxx’x, 6%; or (c) for any Obligor that is Wal-Mart, (i) if Wal-Mart is rated
AA or better by S&P and Aa2 or better by Xxxxx’x, 18%, or (ii) if Wal-Mart
is not so rated but is rated at least AA- by S&P and Aa3 by Xxxxx’x, 15% or
(iii) if Wal-Mart is rated A+ or lower by S&P and A1 or lower by Xxxxx’x,
the applicable percentage shall be as set forth for Obligors and Special
Obligors in this definition. If the ratings from S&P and Xxxxx’x
fall within different categories, the Normal Concentration Percentage shall be
based on the category in which the lower of the two ratings falls. If
any Obligor is rated only by S&P or only by Xxxxx’x, the Normal
Concentration Percentage shall be based on the rating by such Rating Agency
without regard to a rating by any other Rating Agency; and
(2) at all
times following the expiration of the Waiver Period (a) for any Obligor that is
not a Special Obligor, 3%; or (b) for any Obligor that is a Special Obligor, (i)
if such Special Obligor is rated A+ or better by S&P and A1 or better by
Xxxxx’x, 12% or (ii) if such Special Obligor is not so rated but is rated at
least BBB- by S&P and Baa3 by Xxxxx’x, 6%. If the ratings from
S&P and Xxxxx’x fall within different categories, the Normal Concentration
Percentage shall be based on the category in which the lower of the two ratings
falls. If any Obligor is rated only by S&P or only by Xxxxx’x,
the Normal Concentration Percentage shall be based on the rating by such Rating
Agency without regard to a rating by any other Rating Agency.
2.3. The
definition of “Net Receivables Pool Balance” set forth in Exhibit I to the
Agreement is hereby amended by inserting, immediately prior to the period at the
end of such definition, the following proviso:
; provided, that, for
purposes of calculating the Outstanding Balance of each such Eligible Receivable
then in the Receivables Pool, to the extent that the Outstanding Balance of such
Receivable has been reduced by the Servicer by application of payments on
account of such Receivable deposited to the Lock-Box Accounts, Collection
Account and/or Liquidation Account but not yet available funds, the Outstanding
Balance of such Receivable shall be deemed increased solely to the extent of
such payments until such time as such payments become available
funds.
2.4. The
definition of “NRB” set forth in the definition of “Participation” set forth in
Exhibit I to the Agreement is hereby amended in its entirety as
follows:
NRB=the
Net Receivables Pool Balance at the time of computation.
2.5. Exhibit I to the
Agreement is hereby amended by adding the following new definition thereto in
the appropriate alphabetical order:
“PPC Limited Duration Waiver
Agreement” means the Pilgrim’s Pride Corporation Limited Duration Waiver
Agreement, dated as of September 26, 2008, among Pilgrims Pride Corporation,
Pilgrim’s Pride Funding Corporation, the various purchasers and purchaser agents
from time to time party thereto and BMO Capital Markets Corp.
“Waiver Period” has
the meaning set forth in the PPC Limited Duration Waiver Agreement.
“Wal-Mart” means
Wal-Mart Stores, Inc., a Delaware corporation, and its
subsidiaries.
SECTION
3. Representations and
Warranties. Each of the Seller and the Servicer hereby
represents and warrants to the Purchaser and the Administrator that the
representations and warranties of such Person contained in Exhibit III to the
Agreement are true and correct as of the date hereof (unless stated to relate
solely to an earlier date, in which case such representations and warranties
were true and correct as of such earlier date), and that as of the date hereof,
no Termination Event or Unmatured Termination Event has occurred and is
continuing or will result from this Amendment.
SECTION
4. Effect of
Amendment. (a) All provisions of the Agreement, as expressly
amended and modified by this Amendment, shall remain in full force and effect
and are hereby ratified and confirmed in all respects. After this
Amendment becomes effective, all references in the Agreement (or in any other
Transaction Document) to “this Agreement”, “hereof”, “herein” or words of
similar effect referring to the Agreement shall be deemed to be references to
the Agreement as amended by this Amendment. This Amendment shall not
be deemed, either expressly or impliedly, to waive, amend or supplement any
provision of the Agreement other than as set forth herein.
(b) Notwithstanding
anything in the Agreement or any other Transaction Document to the contrary,
each of the parties hereto, hereby consents and agrees to the amendments
contemplated hereby and that all of the provisions in the Agreement, the
Purchase and Contribution Agreement, the Purchase Agreement and the other
Transaction Documents shall be interpreted so as to give effect to the intent of
the parties hereto as set forth in this Amendment.
SECTION
5. Effectiveness. This
Amendment shall become effective as of the date hereof upon receipt by the
Administrator of the following (each, in form and substance satisfactory to the
Administrator):
(a) Counterparts
of this Amendment executed by each of the parties hereto (including facsimile or
electronic copies);
(b) (i)
Evidence, in form and substance satisfactory to the Administrator that the
Seller and the Servicer have complied with the Administrator’s request (as
described in its letter to the Seller and the Servicer with respect thereto
delivered on October 9, 2008) to provide the Administrator with a daily
Collateral Report and to direct Collections to the Administrator or an account
designated by the Administrator on a daily basis and (ii) a signed copy of an
account control agreement, in form and substance satisfactory to the
Administrator, covering each of the Lock-Box Accounts at Bank of America,
N.A.;
(c) Evidence,
in form and substance satisfactory to the Administrator, that any requirement
for there to be undrawn commitments under either or both of the BMO Credit
Agreement and the CoBank Credit Agreement, be reduced to an aggregate amount of
not greater than $75,000,000; and
(d) Such
other documents, resolutions, certificates, agreements and opinions as the
Administrator may reasonably request in connection herewith.
For
purposes of this Section 5, (a) “BMO Credit Agreement”, means the Fourth Amended
and Restated Credit Agreement dated as of February 8, 2007 among Pilgrim Pride
Corporation , To-Ricos, Ltd and To-Ricos Distribution Ltd, the various banks
party thereto and Bank of Montreal as agent (as amended, supplemented or
otherwise modified from time to time) and (b) “CoBank Credit Agreement” means,
the Amended and Restated Credit Agreement dated as of September 21, 2006, among
Pilgrims Pride Funding Corporation, CoBank, ACB, Farm Credit Services of
America, FLCA and the various other parties thereof (as amended, supplemented or
otherwise modified from time to time).
SECTION
6. Additional
Covenant. The Company and the Servicer hereby covenant and
agree that, if any upfront fees are paid to the agents, or if pricing or other
fees are otherwise increased, under the BMO Credit Agreement or the CoBank
Credit Agreement in connection with any amendments thereto during the Waiver
Period, the Company (or the Servicer on its behalf) shall (a) in the case of any
upfront fees, pay to the Administrator, within one Business Day of any payment
of fees under any amendments to the BMO Credit Agreement or the CoBank Credit
Agreement, a corresponding fee to the Administrator (calculated by converting
any such fee under the amendments to the BMO Credit Agreement or the CoBank
Credit Agreement into an equivalent rate based on the relative commitments
thereunder and multiplying such equivalent rate by the Commitment) and (b) in
the case of increased pricing or other fees, as soon as practicable thereafter
amend the Agreement or Purchaser Group Fee Letter or execute such other
documents as may be requested by the Administrator, in form and substance
satisfactory to the Administrator, to reflect increased pricing or other fees on
similarly favorable terms.
SECTION
7. RELEASE. FOR VALUE RECEIVED,
INCLUDING WITHOUT LIMITATION, THE AGREEMENTS OF THE ADMINISTRATOR AND THE
PURCHASERS IN THIS AMENDMENT AND THE AGREEMENT AS AMENDED HEREBY, EACH OF THE
SELLER AND THE SERVICER HEREBY RELEASES THE ADMINISTRATOR, EACH PURCHASER AGENT,
EACH PURCHASER, EACH INDEMNIFIED PARTY AND THEIR RESPECTIVE CURRENT AND FORMER
SHAREHOLDERS, DIRECTORS, OFFICERS, AGENTS, EMPLOYEES, ATTORNEYS, CONSULTANTS,
AND PROFESSIONAL ADVISORS (COLLECTIVELY, THE “RELEASED PARTIES”) OF AND FROM ANY AND ALL
DEMANDS, ACTIONS, CAUSES OF ACTION, SUITS, CONTROVERSIES, ACTS AND OMISSIONS,
LIABILITIES, AND OTHER CLAIMS OF EVERY KIND OR NATURE WHATSOEVER, BOTH IN LAW
AND IN EQUITY, KNOWN OR UNKNOWN, WHICH SUCH SELLER OR SERVICER HAS OR EVER HAD
AGAINST THE RELEASED PARTIES FROM THE BEGINNING OF THE WORLD TO THIS DATE
ARISING IN ANY WAY OUT OF THE EXISTING FINANCING ARRANGEMENTS BETWEEN THE
SELLER, THE SERVICER, THE ADMINISTRATOR, THE PURCHASER AGENTS AND THE
PURCHASERS, AND EACH OF THE SELLER AND THE SERVICER FURTHER ACKNOWLEDGES THAT,
AS OF THE DATE HEREOF, IT DOES NOT HAVE ANY COUNTERCLAIM, SET-OFF, OR DEFENSE
AGAINST THE RELEASED PARTIES, EACH OF WHICH EACH OF THE SELLER AND THE SERVICER
HEREBY EXPRESSLY WAIVES.
SECTION
8. Counterparts. This
Amendment may be executed in any number of counterparts and by different parties
on separate counterparts, each of which when so executed shall be deemed to be
an original and all of which when taken together shall constitute but one and
the same instrument.
SECTION
9. Governing
Law. This Amendment, including the rights and duties of the
parties hereto, shall be governed by, and construed in accordance with, the laws
of the State of Texas (without giving effect to the conflict of laws principles
thereof).
SECTION
10. Section
Headings. The various headings of this Amendment are included
for convenience only and shall not affect the meaning or interpretation of this
Amendment, the Agreement or any provision hereof or thereof.
SECTION
11. JURY
TRIAL. THE JURY TRIAL WAIVER SET FORTH IN SECTION 6.10 OF THE
AGREEMENT SHALL APPLY TO THIS AMENDMENT AS IF IT WERE FULLY SET FORTH
HEREIN.
(continued
on following page)
5225406 98442494
IN
WITNESS WHEREOF, the parties have caused this Amendment to be executed by their
respective officers thereunto duly authorized as of the date first above
written.
PILGRIM’S
PRIDE FUNDING CORPORATION,
as
Seller
By: /s/ Xxxxxxx X.
Xxxxxxx
Xxxxxxx X. Xxxxxxx
Chief Financial Officer, Secretary and
Treasurer
PILGRIM’S
PRIDE CORPORATION,
as
initial Servicer
By: /s/ Xxxxxxx X.
Xxxxxxx
Xxxxxxx X. Xxxxxxx
Chief Financial Officer, Secretary and
Treasurer
FAIRWAY
FINANCE COMPANY, LLC,
as
Uncommitted Purchaser and as Related Committed Purchaser for the BMOCM Purchaser
Group
By: /s/ Xxxxxxx X.
Xxxxxxx
Name:
Xxxxxxx X. Xxxxxxx
Title: Vice
President
BMO
CAPITAL MARKETS CORP.,
as
Administrator and as Purchaser Agent for the BMOCM Purchaser Group
By: /s/ Xxxxx
Xxxxx
Name:
Xxxxx Xxxxx
Title: Managing
Director
|
S-
|
Amendment
No. 1 to A&R RPA
|
5225406 98442494
